Multi-tier channel marketing involves more than one marketing intermediaries. The channel members of the Indirect marketing model constitutes functions as Collection of goods, Warehouse Management, Financing the goods, risk-taking ability, escalation of goods, payment collection, et al. Some food for thought here: with multi channels arises multiple responsibilities. They offer a great impact on your bottom-line but requires great deal of attention and management- the reason many companies rigorously use Secondary Sales Tracking Software to manage their sales.
The focal point here however is of "monitoring the sales". It is ironic that with multiple channels, the sales funnel gets widened with an inverse effect on the visibility over sales processes. The inventory is scattered over the country and there is little to no visibility over the in-transit, delivered and supplied stock. This article draws attention towards some of the complexities involved in managing channel sales. Some of them are highlighted below:
Handling Relationships: There are usually three parties involved in channel sales- the vendor (primary level), the resellers or partners (secondary level), and mom and pop shops or modern trade stores (tertiary level). For all these three levels you have to set the credit limit, product price list, terms and conditions, and monitor if all are adhering to it. While you can supervise the immediate next level, that is the primary level, monitoring secondary sales channel is a challenge that decimates the multi-channel sales operations.
Credibility of Channel Partner: Handling the responsibility of your product sale to your distributors and dealers is a matter of great trust. Channel partners should be your credible advocates to push your product to final sales. This activity of measuring partner's performance and credibility can be done on the basis of facts and figures. The absence of any tool to automate and quantify the performance level often leads to disoriented partner channel.
Inventory Management: The best thing with channel partners and distributors is that they eradicate the hindrances of time and geography in multi-channel marketing; but the bad thing is that you don't get to keep a direct control over the inventory. To recognize the revenues exactly, you don't just need to have an understanding of what you have in hand, but also in what your partners at all levels- secondary and tertiary have.
Price Protection: Price protection is one of the very steamy parts of sales management. When a distributor or reseller partner buys the goods at an old price, they are almost always entitled to be "protected" against the decrease in cost. Calculating price protection at all levels becomes a challenge, resulting in dissatisfied partners / resellers.
These are some of the basic hurdles that come in the way of multi-tier product selling. This however, does not humble the immense impact of channel marketing on your profitability. Every challenge becomes an opportunity if these processes are automated and integrated with Secondary Sales Management Software. This would result in improved efficiency and agility, while costs are lowered. Automating the sales channel is the key- you just have to turn it right by choosing an accurate and comprehensive Secondary Sales Management Software.